China's ongoing anti-dumping investigation on imports of US distillers' dried grains (DDGS) has been extended by six months to June 28, 2012, the Ministry of Commerce said Wednesday (Dec 28).

China remains the largest market for US exports of DDGS, a corn-based animal feed, after Mexico.

The ministry began the probe on DDGS, a byproduct of the process of turning corn into ethanol, a year ago.

At the time, US farm interests viewed the commodity as a significant new trade opportunity in China. Chinese imports of US DDGS rose nearly five times last year to three million tonnes.

US industry interests had raised the possibility that the probe was retaliation for a US investigation of alleged Chinese subsidies on wind energy. The wind energy probe has since been settled with the Chinese.

China's DDGS imports fell sharply from 2010 levels after the probe began but did not entirely collapse, reaching 1.3 million tonnes in the first 10 months of the year, according to China's customs data.

Chinese grain officials suggested in June this year that the official investigation would likely result in "lower-than-expected" anti-dumping duties on the US product.

"The preliminary finding was that during the period under anti-dumping investigation, imported DDGS prices were on average higher than comparable local prices," the China National Grain and Oils Information Centre said.

"The case for US dumping is not clear, and even if a case for material damage is found, the anti-dumping deposit may be lower than expected," it said.

China announced a record corn harvest this year, with production rising 8% to 192 million tonnes. The bumper crop has reduced the urgency for the government to import corn to replenish its depleted grain reserves.

China is keen to preserve self-sufficiency in grain output, but the country has turned a net importer of corn since 2010.